To protect our economy and democracy from the corrosive power of dynastic wealth, The For the 99.8% Act replaces our weak estate tax with a progressive dynasty tax that prevent plutocrats from amassing obscene wealth.
Our society is experiencing an unprecedented and existential threat: Dynastic wealth. The top 0.1% of the country owns almost as much wealth as the bottom 90%. While three-quarters of Americans are living paycheck-to-paycheck and 40% of Americans can’t cover $400 expense, the three richest Americans have more wealth than 164 million of us – that’s roughly half of the country.
A key reason is our flawed estate tax, which allows the wealthiest Americans to inherit millions of dollars completely tax-free. As 19 million Americans live in poverty, the children of multi-millionaires and billionaires who haven’t worked a day in their life get to be handed their parents’ fortunes without paying their fair share. The 2017 Tax Cuts and Jobs Act made matters even worse by increasing the amount that rich heirs could inherit tax-free.
Dynastic wealth is corrosive to everything the United States of America is supposed to stand for. It skews our economy, tilting it towards a few wealthy individuals while hollowing out the middle class who actually make our economy work. It also harms the fabric of our democracy. Billionaire families like that of Betsy DeVos, the Waltons, and the Adelsons spend their inherited millions on elections, allowing them to buy political outcomes that rig the system further in their benefit.
The For the 99.8% Act is plutocracy prevention: It stops plutocrats from passing their wealth and power onto their heirs. It reverses the Tax Cuts and Jobs Act’s changes to the estate tax and taxes the wealthiest 0.2 percent of Americans who inherit over $3.5 million. It creates a new, progressive system that ensures billionaire estates are taxed as they increase. Finally, it ends tax breaks and loopholes that billionaires use to get around the rules.
The For the 99.8% Act – at a glance
Bill number(s): S. 309 | H.R. 4857
Sponsors: Sen. Bernie Sanders | Rep. Jimmy Gomez
Status: Introduced in the Senate and House
What it does:
Prevents plutocrats from passing their unchecked wealth and power onto their heirs by taxing it
The For the 99.8% Act reverses the Tax Cuts and Job Act change that egregiously exempted up to $22.4 million in inherited wealth from estate taxes. In its place, it imposes a progressive estate tax on all inherited wealth over $3.5 million. Only 0.2% of the country, a few hundred multi-millionaires and billionaires, inherit that much money.
Creates a new, progressive estate tax structure
To level the playing field, the For the 99.8% increases the tax rates as the value of an estate increases.
- 45% on estates valued between $3.5 and $10 million
- 50% on estates valued between $10 millionaires and $50 million
- 55% on estates valued over $50 million
- 77% on estates valued over $1 billion
Ends incentives and loopholes that let the rich dodge paying their fair share
One way billionaires dodge taxes is by putting their fortunes in trusts. The bill would strengthen the “generation-skipping tax” by applying it to any trusts set up to last more than 50 years. It also prevents billionaires from putting money in trusts and pulling it out just a few years later after avoiding taxes. The bill also closes other loopholes that allow billionaires to misrepresent their fortunes as smaller than they actually are to avoid payment.
Does NOT impact 99.8% of the country
People who inherit more than $3.5 million make up only 0.2% of the country – a few thousand out of hundreds of millions. 99.8% of Americans will not pay a single penny more. For comparison, the Federal Reserve found in 2013 that the bottom 95% of the country receives between of $68,000 to $183,000 in inheritance. And, contrary to Republican claims, it will not impact “small family farms,” which almost exclusively are valued far below $3.5 million.
“We are hurtling towards a destabilizing level of inequality and bold measures. Our elected leaders can’t make the 1 percent be generous. But we can require them to pay their fair share.”
Chuck Collins, Patriotic Millionaire and heir to the Oscar Mayer fortune